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UNECE region forest products markets respond positively to globalization: Forest products markets and policies in 2004 and 2005

Published: 02 August 2005

Geneva
The United Nations Economic Commission for Europe (UNECE) and the Food and Agricultural Organization (FAO) just released the UNECE/FAO Forest Products Annual Market Review, 2004-2005. It covers forest products market and policy developments in the UNECE region of Europe, North America and the CIS countries. Depending on the product, the region’s share of global production of primary forest products ranges from 73% to 82% and the share of world exports ranges from 75% to 90% (see graphs). Its main findings are:

  • Strong economic conditions, combined with effective industry and government promotion policies, drove forest products markets to record levels in 2004 for the UNECE region as a whole. As an indication of demand, consumption of primary forest products rose by 4% and by over 50 million cubic metres (m3), to reach 1.3 billion m3 in 2004 for the region.

  • China’s imports of unprocessed and semi-processed wood from the UNECE region, and its exports of value-added production back to the region, have mixed effects, depending on how successfully companies have adapted to globalization.

  • Illegal logging is less than 1% of legal fellings for most countries in the UNECE region; however it is greater for a few countries, with substantial environmental, social and economic costs to governments, and with negative ramifications throughout the sector.

  • For the first time as consumption expanded, driven by over 2 million housing starts, North America became a net importer of sawn softwood in 2004 when its sawnwood imports expanded by over 15%, and at 42 million m3, exceeded European imports.

  • The important forest sector policy issues of 2004 in Russia included the Kyoto Protocol ratification, debates about private ownership of forests, use of satellites for preventing illegal logging and legal disputes over ownership and management of some wood and paper companies.

  • Secondary processed wood product exports by tropical countries exceeded the value of primary wood product trade in 2004 for the first time, reflecting successful policies to promote value-added production.

  • In both North America and Europe, trade associations have joined forces to promote value-added processing, and to promote the forest and forest industries sector in general.

  • Concerns that wood products are legally and sustainably produced, drove governments, industry and retailers to implement purchasing policies requiring certified forest products, thereby influencing all market sectors.

  • With over 240 million hectares of certified forestland, an increase of one third in the last year, the supply of certified forest products is increasing in all market sectors, from roundwood to value-added wood products.

  • Sawn hardwood consumption is falling within the UNECE region, down by 3% in 2004 from 2003, largely due to downsizing of the US furniture industry in response to imports from Asia; however, hardwood exports to Asia increased.

  • Wood-based panels markets were driven by construction, flooring and furnishing to records across the UNECE region. For example, production increased in Europe by 6% to reach 64 million m3, in North America by 3% to reach 61 million m3, and in the CIS by 12% to reach 9 million m3. Trade of panels was active, and imports of panels from outside the region increased – in come cases they were met with trade restrictions.

  • Paper and pulp markets moved up strongly in the UNECE region, to record levels in Europe, e.g. paper and paperboard production increased by 4% to reach 103 million metric tons, in line with economic growth and due to export demand.

UNECE region’s share of world production of primary forest products, 2004
UNECE region’s share of world primary forest products exports, 2004
Notes: UNECE region in 2004, world in 2003 (most current statistics).
Sources: UNECE/FAO TIMBER database, FAO statistics, 2005.
Notes: UNECE region in 2004, world in 2003 (most current statistics).
Sources: UNECE/FAO TIMBER database, FAO statistics, 2005.

The Forest Products Annual Market Review begins with an overview of forest products markets and policies, followed by a chapter focusing on policy issues related to forest products markets. These are followed by analyses of the economic factors affecting the forest and forest industries sector. Statistics-based chapters are included for markets of sawn softwood, sawn hardwood, wood-based panels, paper, paperboard and woodpulp, wood raw materials and tropical timber. Other chapters highlight the rapid developments in forest products certification, as well as value-added wood products, e.g. furniture.

Copies of the Review may be obtained from the website homepage of the UNECE Timber Committee and the FAO European Forestry Commission, or from the postal address below. For further information please contact:

Mr. Ed Pepke

Forest Products Marketing Specialist
UNECE/FAO Timber Branch
Trade Development and Timber Division
United Nations Economic Commission for Europe
Palais des Nations, Room 448
CH - 1211 Geneva 10, Switzerland

Phone: +41 (0) 22 917 2872
Fax: +41 (0) 22 917 0041
E-mail: info.timber@unece.org
Website: http://www.unece.org/trade/timber

Ref: ECE/TIM/05/P05


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